Virtual memory is a way of representing your memory that's abstracted from the physical memory on your machine. It makes use of both your RAM and your storage space, whether that's on a traditional hard drive or an SSD. In Linux, this is done at the kernel and hardware levels².
Linux supports virtual memory, that is, using a disk as an extension of RAM so that the effective size of usable memory grows correspondingly. The kernel will write the contents of a currently unused block of memory to the hard disk so that the memory can be used for another purpose¹.
Virtual memory takes advantage of the fact that not all of the memory that's being used in theory is being used all of the time. Programs in memory are broken down into pages and the parts that the kernel deems as unnecessary are "swapped out," or moved to the hard drive. When they're needed, they can be "swapped in," or brought back into RAM².
The space used for virtual memory on a drive is known as "backing store," or "swap space." In the Windows world, it's usually implemented as a file, known as a "swap file." It's also possible to do this in Linux, but it's much more common to use a dedicated disk partition².
The upshot of virtual memory is that it's possible to run large programs by using more memory than the physical RAM in your machine. Virtual memory also allows developers to create applications without having to know how a computer's memory is organized².
The main downside historically with virtual memory has been that hard drives have been slower than RAM. If a machine doesn't have enough RAM, the system can keep swapping pages in and out endlessly, a process known as "thrashing." This is less of an issue on modern PCs with more RAM and faster SSDs displacing mechanical hard drives, but it's still something to be aware of
